THE telecoms giant also cut its broadband prices for new customers and will offer free top flight football to new and existing broadband customers.

Marc Watson, CEO of BT Vision, announces that the new BT Sport channels will be free (Photo: David Parry/PA Wire)

Share

Get daily updates directly to your inbox

Thank you for subscribing!

Could not subscribe, try again laterInvalid Email

BT threw down the gauntlet to BSkyB today by offering free live Premier League action to football fans for the first time.

The telecoms giant, which is muscling in on Sky's dominance of sport after winning a three-year deal to show 38 Premier League games a season, also cut its broadband prices for new customers.

New copper broadband customers will pay £10 per month and £15 for faster fibre optic internet. BT's offer of free top flight football to new and existing broadband customers sent shares in BSkyB sliding more than 7%.

It also plans to wrestle pubs from Sky with a sports package which it claims could be 78% cheaper than its rival.

"Many have been priced out of the market but we will change this by giving away BT Sport for free with our broadband. Sports fans are the winners today."

Sky responded by labelling it a "marketing gimmick" designed to halt its loss of broadband customers.

Analysts said Sky is likely to cut prices in response to BT's "gamble", but said a "mass exodus" is unlikely.

The group also announced a host of big names to front its coverage.

Manchester United defender Rio Ferdinand has been signed up by BT as a football expert, joining Tottenham's Gareth Bale and Arsenal's Alex Oxlade-Chamberlain.

Double Champions League winners Owen Hargreaves and Steve McManaman and former England goalkeeper David James have also been signed up as football experts to its sports channels, which will be called BT Sport 1, BT Sport 2 and ESPN.

Commentators will include former England striker Michael Owen, Ian Darke and Darren Fletcher.

BT Sport will run from three studios in the broadcast centre used by the world's media during the London 2012 Games in Stratford, east London.

Its channels will also show 69 live Aviva Premiership rugby games per season, plus live football from leagues in Germany, France, Italy and Brazil.

The sports channels will launch in August, although the exact date has not yet been confirmed.

Sky has refused to air BT's advertisements for the new channels, prompting BT to complain to media watchdog Ofcom.

BT is offering pubs and clubs 12 months' subscription for the price of nine, which it said works out at £135 per month for many independent pubs. Hotels, golf clubs and betting shops will also be offered sport packages which BT said "massively undercut" its rival.

BT Sport and broadband customers on its cheapest internet tariff will pay a total £25.45 a month, including line rental of £15.45 a month.

That compares with a total of £57 a month for Sky customers who take broadband and Sky Sports - receiving 116 Premier League games plus a wide range of other sports.

The BT Sport channels will be available via set-top boxes, satellite and fibre internet.

Customers will be able to use existing Sky boxes, or may have to buy a new box for up to £299.

BT will charge £15 a month to customers who want high definition sport but do not want BT broadband, and £12 a month for standard definition.

Coverage will be anchored by former BBC man Jake Humphrey, while Clare Balding will present a weekly sports show.

BT underlined its ambitions in sport last year when it bid £738 million for the three-year package of Premier League football.

But shares in BT slid 2% on worries over cost.

Jonathan Doran, analyst at technology consultancy Ovum, said: "It's a bit of a gamble because of the huge cost they have spent on the sports rights but I couldn't really see any other way forward for BT.

"It's quite clever what they have done - they had to do something very creative."

Patrick Yau, media analyst at Peel Hunt, said: "People are beginning to see BT as a bit more of a threat than it was.

"I suspect Sky will look at pricing competitively, but they will also point to the fact you get a lot more with a Sky Sports package.

"People who are borderline will churn off but I don't think there will be a mass exodus - one should not underestimate the power of inertia."

Stephen van Rooyen, Sky's managing director of marketing, said: "This is all about broadband and BT's latest attempt to stem the flow of customers who've switched in their millions to rivals like Sky over the last few years.